Government Will Pay $3 Million in Coffee Table Spying Suit

The U.S. has agreed to pay $3 million to a former government worker who accused officials with the CIA and State Department of spying on him with a bugged coffee table.

Rather than comply with a court order to provide lawyers in the case with what the U.S. government says is classified information, the government has agreed to settle to end the 15-year-old suit.

A close review of the case suggests that the Justice Department also decided to pay off the plaintiff in order to quash the series of damaging legal rulings issued by the influential judge overseeing the case that would have forced them to disclose the classified information. Those decisions may have a bearing on the “state secrets privilege” that the Bush and Obama administrations have used to try and thwart a high-profile lawsuit in California over illegal wiretapping conducted in the war on terror.

The government has filed a motion to vacate the potentially damaging rulings in the coffee table case. As part of the settlement agreement, filed November 3 in the U.S. District court in the District of Columbia, the plaintiff has agreed not to oppose the government’s motion to vacate.

In the settlement agreement (.pdf), Justice Department attorneys acknowledged that “the opportunity to seek vacatur is a significant reason why the Government is entering into settlement.”

But lawyers filing on behalf of the California spy suit plaintiffs are urging the D.C. judge to let his rulings stand. The lawyers say the rulings are important to the California case — Al-Haramain Islamic Foundation vs. Obama — challenging the legality of the Bush administration’s warrantless surveillance program.

“The opinions will be a valuable resource for litigants and courts as these issues arise in other cases,” the lawyers wrote in their brief (.pdf) Friday.

The Al-Haramain case accuses the government of violating the Foreign Intelligence Surveillance Act by illegally wiretapping two lawyers for the Al-Haramain Islamic Foundation without a warrant. The government has asserted the “state secrets privilege” in that case in an effort to keep the alleged wiretap victims from introducing into evidence a classified document the government gave them by mistake, which purportedly backs their claims that they were spied on.

The Justice Department is “willing to pay absolute top dollar [in the D.C. case] to get out from some very damaging opinions” says Jon Eisenberg, attorney for the plaintiffs in the Al-Haramain case. “They are desperate to make the decisions go away and to deprive me of the ability to cite those decisions in the future.”

Although district court opinions aren’t binding elsewhere, they are regularly published and cited in other cases.

The D.C. rulings could help convince the California court to let plaintiffs view and use the classified document in their case, Eisenberg says. He notes that the D.C. rulings could be particularly persuasive to the San Francisco judge in the Al-Haramain case because they come from U.S. District Judge Royce Lamberth, head of the Foreign Intelligence Surveillance Court until 2002, who is overseeing the coffee table case. The intelligence court is responsible for approving government requests for wiretaps and other types of surveillance in the U.S. in cases involving foreign spying and terrorism.

“When Judge Lamberth speaks on a matter of national security, people listen,” Eisenberg told Threat Level.

Earlier this year, Lamberth ruled in the coffee table case that a judge has authority to determine whether lawyers in a state secrets case have a “need to know” classified information. He ordered the government to give security clearances to lawyers on both sides of the lawsuit –including the private attorneys for the government employees accused of spying — in order to give them access to information the government claimed was classified so they could better represent their clients.

Obama’s Justice Department, which had asserted the state secrets privilege in the case, called the judge’s decision at the time “an unprecedented departure from the Executive’s exclusive authority to control access to classified information.”

The government was in the process of appealing Lamberth’s rulings when it announced the settlement agreement.

The D.C. case, Horn v. Huddle, was first filed in 1994 and involves listening devices purportedly used by the Central Intelligence Agency in Burma in the 90s, including a coffee table said to be an eavesdropping transmitter.

Richard Horn, formerly a special agent with the Drug Enforcement Administration, alleged that Franklin Huddle, Jr, who was the State Department’s mission chief at the U.S. embassy in Burma, and Arthur Brown, who worked for the CIA there, planted listening devices in his home in 1992 while he was stationed in Burma (now Myanmar).

Horn claims that one day in November 1992, while he was at work at the U.S. embassy, someone entered his residence and replaced a government-issued coffee table with an oval table without consulting him.

He later came to believe that the oval table was a listening device, after discovering that Huddle and Brown were privy to details of conversations he’d had while in the room where the table resided. He’d also learned from a former NSA official that similar oval tables were placed in the homes of all U.S. diplomats and officials assigned to the U.S. embassy in Burma. Horn was led to believe there was a reason these particular tables were installed in the homes.

Horn claimed the defendants spied on him to obtain information to discredit him with his DEA superiors and convince the agency to recall him from Burma. He asserted that through discovery he would prove the table he received was a listening device.

The Justice Department vigorously fought the case for more than a decade, and in 2000 invoked the state secrets privilege. In 2004, Judge Lamberth dismissed the case, in large part because the CIA had asserted that Brown was a covert operative whose association with the agency could not be disclosed.

The government notified the court in 2008, however, that it had made an error and that Brown’s work for the CIA had actually been publicly disclosed in 2002. The case resumed, and when the government re-asserted the state secrets privilege, the judge accused the CIA of deliberately misleading the court about Brown’s covert nature to get the case dismissed the first time. He unsealed hundreds of documents that had been sealed since 1994.

Then in August, Lamberth ordered the government to give the lawyers security clearances to view other confidential data, saying the government’s misrepresentation of Brown when it first asserted the state secrets privilege effectively nullified that privilege.

Eisenberg says Lamberth’s opinion and ruling could have great significance for his case in California, since the government has also admitted to an inaccuracy in the Al-Haramain case.

U.S. District Judge Vaughn Walker, who is presiding over that case, ordered the government to process the plaintiff attorneys for security clearances to view the classified document in that case, but the government resisted, saying the lawyers did not have a “need to know.” Walker ultimately skirted the issue and decided instead to allow the case to proceed, but without the classified document, effectively thwarting the plaintiff’s case.

But earlier this year, after President Obama took office, Justice Department lawyers admitted to an inaccuracy in their assertion of the state secrets privilege in the Al-Haramain case. The actual filing explaining the nature of the inaccuracy is classified and has only been disclosed to Judge Walker. But Eisenberg says that if the inaccuracy turns out to be a misrepresentation of fact, then the case would have parallels to the coffee table spying case, and Lamberth’s decision to allow attorneys to see classified documents in that case could sway Walker to allow the same in the Al-Haramain case.

“There’s a secret filing owning up to an inaccuracy,” Eisenberg says. “We don’t know what it is, but we’d surely like to know.”